Microsoft Corp plans to purchase a tech firm recognized for serving to to develop Apple’s Siri speech recognition software program in a deal valued at $19.7bn (£13.3bn).
The buy of Nuance Communications is the second largest in Microsoft’s historical past, after its acquisition of networking website LinkedIn in 2016.
Microsoft said it could bolster its software program and synthetic intelligence experience for healthcare corporations.
So-called “telehealth” and distant physician visits have boomed in lockdown.
This progress is forecast to proceed after the pandemic.
“Nuance provides the AI layer at the healthcare point of delivery,” Microsoft chief govt Satya Nadella mentioned in a press release. “AI is technology’s most important priority, and healthcare is its most urgent application.”
The deal, which incorporates Nuance debt, is predicted to be accomplished this 12 months.
What is Nuance?
Nuance, based mostly in Massachusetts, was based in 1992. It employs greater than 1,600 individuals globally and is energetic in 28 international locations.
Known as a speech recognition pioneer, it has extra just lately centered on offering software program to the healthcare trade, comparable to software program that helps to automate radiology studies and makes it simpler for docs to create affected person notes by dictation.
Why are they becoming a member of forces?
Nearly 80% of US hospitals are already Nuance prospects, Mr Nadella mentioned. Purchasing the firm will dramatically increase Microsoft’s potential market within the well being care trade.
Nuance executives mentioned becoming a member of forces with Microsoft would assist deepen its cloud-based choices and permit it to faucet into Microsoft’s present international buyer base.
The acquisition builds on a partnership the 2 corporations fashioned in 2019 to automate scientific administrative work comparable to documentation.
Wedbush Securities analyst Dan Ives mentioned the deal was “a strategic no brainer in our opinion for [Microsoft] and fits like a glove into its healthcare endeavours at a time in which hospitals and doctors are embracing next generation AI capabilities from thought leaders such as Nuance”.
“Clearly, [Microsoft] is on the “offensive” around M&A with the company in a clear position of strength to capitalize on its entrenched position in the cloud going forward,” he added, calling Nuance “another feather in its cap”.
What are the monetary particulars?
Microsoft is to pay $56 per share to carry the firm beneath its personal roof. That worth is about 23% larger than the place Nuance shares had been buying and selling on Friday.
Shares in Microsoft had been flat following the announcement, whereas Nuance gained greater than 16%. The boards of each corporations have accepted the transaction.